A-66-81
The Canadian Broadcasting League (Appellant)
v.
Canadian Radio-television and Telecommunica
tions Commission and Kingston Cable T.V. Lim
ited (Respondents)
Court of Appeal, Urie, Le Dain JJ. and Kelly
D.J.—Toronto, March 24; Ottawa, June 30, 1982.
Broadcasting — Appeal from decision of CRTC allowing
respondent Kingston Cable T.V. Limited to amend its cable
television broadcasting licence by increasing installation fee
and maximum monthly fee to subscribers — Whether CRTC
authorized by statute or regulation to approve, by way of
amendment of licence, such amendment — Broadcasting Act
giving CRTC power to issue and amend licences, fix fees and
supervise broadcasting system — Whether Commission has
general authority to fix fees cable television licensee may
charge When considering validity of regulations under s. 16
or conditions to licence, one must examine whether regulations
or conditions fit into one of classes in s. 3 — Where CRTC
issues a cable television broadcasting licence conferring a
territorial monopoly, authority to fix fees exists by necessary
implication to further policy objectives of s. 3 — Specific
statutory criteria not required Appeal dismissed — Broad
casting Act, R.S.C. 1970, c. B-11, ss. 3, 15, 16(1)(b),
17(1)(a),(b), 26(1) Cable Television Regulations, C.R.C., c.
374, s. 17 — Canadian Radio-television and Telecommunica
tions Commission Act, S.C. 1974-75-76, c. 49.
This is an appeal under the Broadcasting Act from a decision
of the CRTC allowing the respondent Kingston Cable T.V.
Limited to amend its cable television broadcasting licence by
increasing the amount of the installation fee and the maximum
monthly fee it may charge its subscribers. Leave was granted
by the Court of Appeal on one ground only: whether the CRTC
was authorized by statute or regulation to approve such an
amendment. The precise issue as to the validity of the CRTC's
decision is whether paragraph 17(1)(a) confers authority on the
CRTC to authorize that amendment.
Held, the appeal is dismissed. Cable television is subject to
regulation under the Broadcasting Act as a "broadcasting
receiving undertaking" within the definition of "broadcasting
undertaking" in section 2. The decision of the Commission
approved an application to amend the licence of Kingston
Cable T.V. Limited, thus purporting to be an exercise of the
authority conferred by paragraph 17(1)(b) of the Act to amend
the conditions to which a licence has been made subject by an
exercise of the authority conferred by paragraph 17(1)(a).
Because the validity of section 17 of the Regulations, which
rests on the regulation-making power contained in paragraph
16(1)(b) of the Act, is also in issue the question becomes an
issue of the CRTC's power, generally, to fix such fees, not just
as a condition of a licence. The appellant argues that the power
to regulate rates and fees must be supported by express statu
tory authority, which power, under the Broadcasting Act, is not
given to the CRTC. In addition, it is not a power that should
exist by necessary implication, as this would have far-reaching
effects. The respondents contend that the Act is comprehensive
enough to support such power because a broad view is to be
taken of the CRTC's powers to implement the broadcasting
policy set out in section 3. Also, the power to set fees exists by
necessary implication just as does the policy of the CRTC that
cable television licensees enjoy a territorial monopoly. When
determining the validity of a regulation made under section 16,
as well as conditions to a licence made under paragraph
17(1)(b), the same principles apply. One must determine
whether the regulation or condition fits within one of the
classes set out in section 3. A broad view is to be taken of what
is embraced by that section having regard to the latitude or
discretion that has been committed to the CRTC to determine
what may be necessary in a particular case for the furtherance
of its policy objectives. Where the CRTC issues a cable televi
sion broadcasting licence that confers a territorial monopoly, it
must necessarily have the authority to fix as a condition the
maximum fees which a licensee may charge subscribers, if it is
to further the policy objective of ensuring the widest possible
public access to the services of the Canadian broadcasting
system, as contained in paragraph 3(c). The CRTC is capable
of considering, in the exercise of its authority, the interests of
subscribers and the financial resources required by a licensee to
provide the quality of service contemplated in section 3, without
the need of specific statutory criteria.
CASES JUDICIALLY CONSIDERED
APPLIED:
Capital Cities Communications Inc., et al. v. Canadian
Radio-Television Commission et al., [1978] 2 S.C.R.
141; CKOY Limited v. The Queen, [1979] 1 S.C.R. 2.
REFERRED TO:
Interprovincial Pipe Line Limited v. National Energy
Board, [1978] 1 F.C. 601 (C.A.); Terra Communications
Ltd. et al. v. Communicomp Data Ltd. et al. (1974), 1
O.R. (2d) 682.
APPEAL.
COUNSEL:
A. J. Roman for appellant.
A. Cohen and P. A. Wylie for respondent,
Canadian Radio-television and Telecommuni
cations Commission.
P. Genest, Q.C. and I. A. Blue for respondent,
Kingston Cable T.V. Limited.
SOLICITORS:
The Public Interest Advocacy Centre, Toron-
to, for appellant.
Canadian Radio-television and Telecom
munications Commission, Ottawa, for
respondent, Canadian Radio-television and
Telecommunications Commission.
Cassels, Brock, Toronto, for respondent,
Kingston Cable T.V. Limited.
The following are the reasons for judgment
rendered in English by
LE DAIN J.: This is an appeal by leave, pursuant
to subsection 26(1) of the Broadcasting Act,
R.S.C. 1970, c. B-11, from Decision CRTC
80-101 [5 C.R.T. 786] issued February 12, 1980
by the Canadian Radio-television and Telecom
munications Commission wherein the Commission
approved in part an application by the respondent
Kingston Cable TV Limited (hereinafter "King-
ston") to amend its cable television broadcasting
licence by increasing the amount of the installation
fee and the maximum monthly fee which it may
charge to its subscribers.
The operative part of the Commission's decision
reads as follows:
Following a Public Hearing held in Toronto, Ontario on 14
November 1979, the Canadian Radio-television and Telecom
munications Commission announces that it approves in part an
application to amend the cable television broadcasting licence
for Kingston, Ontario by increasing the installation fee from
$15.00 to $25.00 and the maximum monthly fee from $6.00 to
$6.50. The Commission approves an installation fee of $25.00
and a partial increase in the maximum monthly fee to $6.25.
The appeal is brought by the Canadian Broad
casting League (hereinafter "CBL"), which was
an intervener before the Commission.
Leave to appeal was sought on the following
three grounds:
1. Parliament does not have jurisdiction under Section 91 of the
British North America Act to confer upon the Respondent,
Canadian Radio-Television and Telecommunications Commis
sion the power to fix fees charged to subscribers for the use of
cable t.v. systems;
2. The Canadian Radio-Television and Telecommunications
Commission is not authorized by statute to fix such installation
and maximum monthly fees for the use by subscribers of cable
t.v. systems;
3. The Respondent, Canadian Radio-Television and Telecom
munications Commission erred in principle in fixing a rate of
return which was not based on a rate of return on capital
invested by the Respondent, Kingston Cable T.V. Limited.
Leave to appeal was granted by this Court on
December 11, 1980 on the following terms:
Leave to appeal is granted on the second ground only of the
three grounds set forth in the applicant's notice of motion,
namely, whether the Canadian Radio-Television and Telecom
munications Commission was authorized by statute or regula
tion to approve, by way of amendment of the licence, the
installation fee and the maximum monthly fee which the
respondent cable television licencee [sic] may charge to its
subscribers. The application is dismissed in respect of the first
and third grounds.
The applicable statute and regulations are the
Broadcasting Act and the Cable Television Regu
lations, C.R.C., c. 374. Cable television is subject
to regulation under the Act as a "broadcasting
receiving undertaking" within the definition of
"broadcasting undertaking" in section 2. See
Capital Cities Communications Inc., et al. v.
Canadian Radio- Television Commission et al.,
[1978] 2 S.C.R. 141, at page 166.
The relevant provisions of the Act for purposes
of the issue in the appeal are sections 3, 15,
16(1)(b) and 17(1)(a) and (b).
Section 3 of the Act, under the heading "Broad-
casting Policy for Canada", is as follows:
3. It is hereby declared that
(a) broadcasting undertakings in Canada make use of radio
frequencies that are public property and such undertakings
constitute a single system, herein referred to as the Canadian
broadcasting system, comprising public and private elements;
(b) the Canadian broadcasting system should be effectively
owned and controlled by Canadians so as to safeguard,
enrich and strengthen the cultural, political, social and eco
nomic fabric of Canada;
(c) all persons licensed to carry on broadcasting undertakings
have a responsibility for programs they broadcast but the
right to freedom of expression and the right of persons to
receive programs, subject only to generally applicable stat
utes and regulations, is unquestioned;
(d) the programming provided by the Canadian broadcasting
system should be varied and comprehensive and should pro-
vide reasonable, balanced opportunity for the expression of
differing views on matters of public concern, and the pro
gramming provided by each broadcaster should be of high
standard, using predominantly Canadian creative and other
resources;
(e) all Canadians are entitled to broadcasting service in
English and French as public funds become available;
(f) there should be provided, through a corporation estab
lished by Parliament for the purpose, a national broadcasting
service that is predominantly Canadian in content and
character;
g) the national broadcasting service should
(i) be a balanced service of information, enlightenment
and entertainment for people of different ages, interests
and tastes covering the whole range of programming in
fair proportion,
(ii) be extended to all parts of Canada, as public funds
become available,
(iii) be in English and French, serving the special needs of
geographic regions, and actively contributing to the flow
and exchange of cultural and regional information and
entertainment, and
(iv) contribute to the development of national unity and
provide for a continuing expression of Canadian identity;
(h) where any conflict arises between the objectives of the
national broadcasting service and the interests of the private
element of the Canadian broadcasting system, it shall be
resolved in the public interest but paramount consideration
shall be given to the objectives of the national broadcasting
service;
(i) facilities should be provided within the Canadian broad
casting system for educational broadcasting; and
(j) the regulation and supervision of the Canadian broadcast
ing system should be flexible and readily adaptable to scien
tific and technical advances;
and that the objectives of the broadcasting policy for Canada
enunciated in this section can best be achieved by providing for
the regulation and supervision of the Canadian broadcasting
system by single independent public authority.
Section 15, under the heading, "Objects of the
Commission", provides:
15. Subject to this Act and the Radio Act and any directions
to the Commission issued from time to time by the Governor in
Council under the authority of this Act, the Commission shall
regulate and supervise all aspects of the Canadian broadcasting
system with a view to implementing the broadcasting policy
enunciated in section 3 of this Act.
Paragraph 16(1)(b) confers authority on the
Commission to make regulations as follows:
16. (1) In furtherance of its objects, the Commission, on the
recommendation of the Executive Committee, may
(b) make regulations applicable to all persons holding broad
casting licences, or to all persons holding broadcasting
licences of one or more classes,
(i) respecting standards of programs and the allocation of
broadcasting time for the purpose of giving effect to
paragraph 3 (d),
(ii) respecting the character of advertising and the amount
of time that may be devoted to advertising,
(iii) respecting the proportion of time that may be devoted
to the broadcasting of programs, advertisements or
announcements of a partisan political character and the
assignment of such time on an equitable basis to political
parties and candidates,
(iv) respecting the use of dramatization in programs,
advertisements or announcements of a partisan political
character,
(v) respecting the broadcasting times to be reserved for
network programs by any broadcasting station operated as
part of a network,
(vi) prescribing the conditions for the operation of broad
casting stations as part of a network and the conditions for
the broadcasting of network programs,
(vii) with the approval of the Treasury Board, fixing the
schedules of fees to be paid by licensees and providing for
the payment thereof,
(viii) requiring licensees to submit to the Commission such
information regarding their programs and financial affairs
or otherwise relating to the conduct and management of
their affairs as the regulations may specify, and
(ix) respecting such other matters as it deems necessary
for the furtherance of its objects; and
Paragraphs 17(1)(a) and (b) provide in part for
the licensing authority of the Commission as
follows:
17. (1) In furtherance of the objects of the Commission, the
Executive Committee, after consultation with the part-time
members in attendance at a meeting of the Commission, may
(a) issue broadcasting licences for such terms not exceeding
five years and subject to such conditions related to the
circumstances of the licensee
(i) as the Executive Committee deems appropriate for the
implementation of the broadcasting policy enunciated in
section 3, and
(ii) in the case of broadcasting licences issued to the
Corporation, as the Executive Committee deems consistent
with the provision, through the Corporation, of the nation
al broadcasting service contemplated by section 3;
(b) upon application by a licensee, amend any conditions of a
broadcasting licence issued to him;
The relevant provision of the Cable Television
Regulations is section 17, which reads:
17. No licensee shall charge any fee or other sum of money
for
(a) any service provided by its undertaking, or
(b) the use of its undertaking,
in excess of the amount authorized by the Commission.
Although section 16 of the Regulations refers to
the installation fee it would not appear to have a
direct bearing on the issue in the appeal. It pre
scribes the duty of a licensee to install equipment
"on receipt of the amount of the installation fee
authorized by the Commission", or where appli
cable, an amount equal to the actual expense of
installation, which a licensee is authorized by
section 16 to charge in certain circumstances. I
may observe here, for such significance as it may
have, that it was asserted by counsel for the Com
mission at the hearing, and as I understood not
disputed, that the installation fee authorized by
the Commission was also intended to be a max
imum fee, although not expressed as such in the
Commission's decision.
Since the decision of the Commission approves
an application to amend the cable television
licence of Kingston it purports to be an exercise of
the authority conferred by paragraph 17(1)(b) of
the Act to amend the conditions to which a licence
has been made subject by an exercise of the au
thority conferred by paragraph 17(1)(a). The pre
cise issue as to the validity of the Commission's
decision would appear, therefore, to be whether
paragraph 17(1)(a) confers authority on the Com
mission to fix, as a condition of a licence, the
installation fee and the maximum monthly fee
which a cable television licensee may charge to its
subscribers. The appeal was also argued, however,
as if the validity of section 17 of the Regulations,
which rests on the regulation-making authority
conferred by paragraph 16(1)(b) of the Act, was
directly involved as a legal foundation of the Com
mission's decision. That provision prohibits a licen
see from charging fees in excess of those author
ized by the Commission. If valid, it provides a
legal basis for authorizing or fixing maximum fees,
apart from paragraph 17(1)(a) of the Act. I am,
therefore, inclined to agree that its validity should
be considered at the same time as the authority
conferred by paragraph 17(1)(a), since what is
really being put in issue by the appeal is the
general authority of the Commission to fix the fees
which a cable television licensee may charge to its
subscribers and not simply whether that can be
done, as a matter of form, as a condition of a
licence.
It is a curious feature of this appeal that it is the
consumer-oriented CBL which challenges the au
thority of the Commission to control the fees of
cable television licensees and it is the licensee
Kingston which defends the Commission's author
ity, but the particular interests or motives of the
parties to the appeal cannot, of course, affect the
consideration of the issue of statutory construction
which is raised by it.
Counsel for CBL contended that there must be
express statutory authority for a power to regulate
rates or fees and that the Broadcasting Act does
not confer such authority on the Commission. He
argued that because of the nature and effect of
rate regulation and the need of authorized criteria
or standards for its exercise it is not a power which
should be found to exist by necessary implication.
He said that an implied power of rate regulation
would be a wholly arbitrary and uncontrolled
power. An attempt was made to show by various
examples, including the authority under section
320 of the Railway Act, R.S.C. 1970, c. R-2, to
regulate tolls in respect of telegraph and telephone
which was formerly vested in the Canadian Trans
port Commission and was transferred to the
CRTC by section 14 of the Canadian Radio-
television and Telecommunications Commission
Act, S.C. 1974-75-76, c. 49, that such authority is
always conferred by express statutory provision. It
was pointed out that the issue has larger implica
tions than the power to regulate the rates or fees
which a cable television licensee may charge to its
subscribers since, if such authority is found in the
Act in the absence of express provision, it must
extend to the rates or fees, if any, which other
broadcasting licensees may charge for service.
Counsel for Kingston, supported by counsel for
the Commission, contended that judicial authority
indicates that a broad view is to be taken of the
Commission's powers for the purpose of imple
menting the broadcasting policy set out in section
3 of the Act, and that on such a view, the terms of
the Act are comprehensive enough to include the
power to regulate the fees which a cable television
licensee may charge to its subscribers. In the
alternative, it was contended that such a power
exists by necessary implication on the principle
that was applied by this Court in Interprovincial
Pipe Line Limited v. National Energy Board,
[1978] 1 F.C. 601 (C.A.) and is set out in Hals-
bury's Laws of England, 3rd ed., vol. 36, para.
657, page 436 as follows: "The powers conferred
by an enabling statute include not only such as are
expressly granted but also, by implication, all
powers which are reasonably necessary for the
accomplishment of the object intended to be
secured." In support of the necessity of such au
thority it was emphasized that by an established
policy of the Commission cable television licensees
enjoyed a territorial monopoly. This was not dis
puted by CBL, and it has been the subject of
judicial notice: see Terra Communications Ltd. et
al. v. Communicomp Data Ltd. et al. (1974), 1
O.R. (2d) 682 at 696; Capital Cities Communica
tions Inc., et al. v. Canadian Radio-Television
Commission et al., [1978] 2 S.C.R. 141 at pages
180-181.
Counsel for Kingston and the Commission
placed particular reliance on the judgment of the
Supreme Court of Canada in CKOY Limited v.
The Queen on the relation of Lorne Mahoney,
[1979] 1 S.C.R. 2, as indicating in their submis
sion, the broad view which must be taken of the
Commission's powers. The issue in that case was
the validity of a Regulation prohibiting a station
or network operator from broadcasting a telephone
interview or conversation with a person without
that person's prior consent, unless the person tele
phoned the station for the purpose of participating
in the broadcast. A majority of the Court held the
Regulation to be valid under section 16 of the Act
as being in furtherance of policy expressed in
section 3. The majority found that the impugned
Regulation dealt with "standards of programs" in
subparagraph 16(1)(b)(î) and "programming",
including high standards of programming, in para
graph 3(d), but it also found support for the
Regulation in subparagraph 16(1)(b)(ix), which
confers authority on the Commission to make
regulations "respecting such other matters as it
deems necessary for the furtherance of its objects",
and thereby refers to the whole of section 3.
On the test to be applied to determine the
validity of a regulation purporting to be made
under section 16, Spence J., delivering the judg
ment of the majority, said at pages 11-12:
The grant of power to enact regulations is given to the
Commission by s. 16 of the statute. By its opening words, such
a power is directed to be exercised "in furtherance of its
objects". Section 15 is entitled "Objects of the Commission".
For our purposes, the said objects may be briefly stated in the
last words of s. 15, "with a view to implementing the broadcast
ing policy enunciated in section 3 of this Act". Therefore, I
agree with the courts below that the validity of any regulation
enacted in reliance upon s. 16 must be tested by determining
whether the regulation deals with a class of subject referred to
in s. 3 of the statute and that in doing so the Court looks at the
regulation objectively. However, I also agree with Evans J.A.
when he states:
It is obvious from the broad language of the Act that
Parliament intended to give to the Commission a wide lati
tude with respect to the making of regulations to implement
the policies and objects for which the Commission was
created.
Therefore, whether we consider that the impugned regulation
will implement a policy or not is irrelevant so long as we
determine objectively that it is upon a class of subject referred
to in s. 3.
With respect to subparagraph 16(1)(b)(ix) as a
foundation for the Regulation, Spence J. said at
pages 13-14:
I find a basis for the enactment of Regulation 5(k) also in s.
16(1)(b)(ix) of the statute. It is to be noted that its very broad
words are not, as are those of s. 16(1)(b)(i), confined to the
policy expressed in s. 3(d) and, therefore, authorize one enact
ment of regulations to further any policy outlined in the whole
of s. 3. It was submitted that s. 16(1)(b)(ix) should be confined
to matters of procedure since it followed s. 16(1)(b)(viii)
enabling the Commission to require licensees to submit infor
mation. But the information which may be required under (viii)
is very broad covering not only the licensees' financial affairs
but "programs" and "the conduct and management of their
affairs." Therefore, the information obtained under a regula
tion enacted by virtue of s. 16(1)(b)(viii) may well provide the
basis for a regulation which the Commission might deem
necessary under s. 16(1)(b)(ix). Such regulation would, of
course, have to be to further the "Broadcasting Policy of
Canada" but it might be difficult to fit it under any of the other
numbered paragraphs of s.16(1)(b). I find it of some impor
tance that the broad words appearing in s. 16(1)(b)(ix) "as it
deems necessary" emphasize the discretion granted to the
Commission in determining what is necessary for the further-
ance of its objects. Therefore, even if the word "programming"
were to receive the narrow meaning advanced by counsel for
the appellant, then s. 16(1)(b)(ix) would authorize the enact
ment of Regulation 5(k). So, the said regulation may well be in
furtherance of the policy set out in, for instance, s. 3(c), that is,
responsibility for the programmes which the licensee broad
casts.
Spence J. also referred at page 14 to the "broad
interpretation" given by Laskin C.J. "to the Com
mission's powers under s. 15 of the Broadcasting
Act" in Capital Cities Communications, supra,
where the Chief Justice spoke at p. 171 of "the
embracive objects committed to the Commission
under s. 15 of the Act".
I conclude from these passages in the judgment
of Spence J. in the CKOY case that while it is for
the Court to determine objectively whether a regu
lation deals with or is upon a subject referred to in
section 3 of the Act, a broad view is to be taken of
what is embraced by that section, having regard to
the latitude or discretion that has been committed
to the Commission to determine what may be
necessary in a particular case for the furtherance
of its policy objectives.
What was said concerning the validity of a
regulation under section 16 applies equally in my
opinion to the validity of a condition attached to a
licence under paragraph 17(1)(a). That section
begins, like section 16, with the words "In further
ance of the objects of the Commission", and
empowers the Executive Committee to subject a
broadcasting licence to such conditions related to
the circumstances of the licensee as it "deems
appropriate for the implementation of the broad
casting policy enunciated in section 3", an author
ity that is, if anything, even broader than that
which is conferred by subparagraph 16(1)(b)(ix).
Where the Commission issues a cable television
broadcasting licence that confers a territorial
monopoly it must surely have the authority to fix
as a condition of that right the maximum fees
which the licensee may charge to its subscribers.
That would appear to be not only appropriate but
necessary to further the policy objective of assur
ing the widest possible public access to the services
of the Canadian broadcasting system, an objective
that is explicitly referred to by the words "the
right .. . to receive programs" in paragraph 3(c)
and is implicit in the whole of section 3 because of
the importance attached to broadcasting in the life
of the country. In the exercise of this authority the
Commission must, of course, consider not only the
interests of subscribers but also the financial
resources required by a licensee to provide the
quality and extent of service contemplated by sec
tion 3. That is something which the Commission is
capable of doing without the need of specific statu
tory criteria or directions.
For these reasons I am of the opinion that the
Commission's decision was valid, and I would
accordingly dismiss the appeal.
URIE J.: I agree.
KELLY D.J.: I concur.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.